A troubled Tyneside shipyard has been handed a lifeline after being granted permission to dismantle ships.

Bosses at Swan Hunter welcomed the decision, which came after bosses warned jobs were at risk because of a lack of work at its Wallsend yard.

On Friday the Environment Agency said it would allow the firm to dismantle ships as well as oil and gas platforms.

Swan Hunter still hopes to secure part of a huge Ministry of Defence aircraft carrier order.

'Proper measures'

The company plans to use a floating dry dock to tow ships into the yard which would then be sealed to prevent any potentially contaminated materials escaping.

Environment Agency manager Graham Donachie said: "As part of our process to determine this application the company has had to carry out a full assessment of any possible impact its process could have on the environment and human health.

"Proper measures need to be put in place to prevent any environmental harm and Swan Hunter has provided us with the technical information to show us that this can be done.

"We will be visiting the yard on a regular basis to ensure it is meeting the conditions set down in the modified waste management licence."

The company's licence allows it to handle permitted wastes up to 120,000 tonnes a year.